Question 1

A $3,000 annual contribution to a retirement account earning 6% will be worth ____ in 20 years.

Accepted Answer

A)  $ 60,000 
B)  $ 96,780 
C)  $100,000 
D)  $110,340 
E)  $192,600 
A)  $ 60,000 
B)  $ 96,780 
C)  $100,000 
D)  $110,340 
E)  $192,600

Question 2

Having an accurate current income and expenditures statement would be very useful when calculating retirement needs.

Accepted Answer

A) True 
 B)False

Question 3

Julie's employer has a defined benefits retirement plan which pays 3.2 percent of her last year's salary for each year of employment.Julie estimates her final salary will be $85,000 and she will have worked for 20 years.What is her expected retirement benefit? (Show all work.)

Accepted Answer

Retirement benefit =

Question 4

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement.
-The employee is subject to the investment risk in a defined [contribution | benefit] plan.

Accepted Answer

The answer of Choose the word or phrase in [...

Question 5

The portion of the principal and interest of an annuity that has not been paid to the annuitant prior to death is the ____ benefit.

Accepted Answer

A)  principal 
B)  distribution 
C)  survivorship 
D)  installment 
E)  accumulated 
A)  principal 
B)  distribution 
C)  survivorship 
D)  installment 
E)  accumulated

Question 6

____ do not have to be covered by Social Security coverage.

Accepted Answer

A)  Farmers and ministers 
B)  Federal civilian employees hired before 1984 and employees of state and local governments 
C)  Federal employees and ministers. 
D)  Teachers and employees of universities. 
E)  Ministers and professional athletes 
A)  Farmers and ministers 
B)  Federal civilian employees hired before 1984 and employees of state and local governments 
C)  Federal employees and ministers. 
D)  Teachers and employees of universities. 
E)  Ministers and professional athletes

Question 7

Whether or not your social security benefits will be subject to income taxes depends on how much other income you received during the year.

Accepted Answer

A) True 
 B)False

Question 8

Henry has a defined benefit plan that promises an annual retirement benefit based on the average of his last five years of salary times 2.5 times years of service.At retirement Henry has 21 years of service and an average salary over the last 5 years of $95,000.What will his annual benefit be?

Accepted Answer

A)  $95,000 
B)  $60,500 
C)  $49,875 
D)  $28,500 
E)  cannot determine 
A)  $95,000 
B)  $60,500 
C)  $49,875 
D)  $28,500 
E)  cannot determine

Question 9

Reduced early retirement Social Security benefits can be received at age 60.

Accepted Answer

A) True 
 B)False

Question 10

Marshall has calculated that he will need $1,250,000 in his retirement fund in 40 years when he plans to retire.If Marshall can earn 8% annually over this period,how much does Marshall need to save annually to meet that goal?

Accepted Answer

The answer of Marshall has calculated that he will need...

Question 11

By itself,Social Security is sufficient to allow a worker and spouse to maintain their preretirement standard of living.

Accepted Answer

A) True 
 B)False

Question 12

Integrating a retirement plan with Social Security benefits typically increases a retiree's retirement income.

Accepted Answer

A) True 
 B)False

Question 13

Government assistance,primarily Social Security,is the largest single source of income for the average retiree.

Accepted Answer

A) True 
 B)False

Question 14

Annuity proceeds are limited to the life of one person.

Accepted Answer

A) True 
 B)False

Question 15

Profit sharing plans allow flexible employer contributions to the plan.

Accepted Answer

A) True 
 B)False

Question 16

With a non-contributory pension plan,the employer makes no financial contribution to the account.

Accepted Answer

A) True 
 B)False

Question 17

A graded vesting schedule would legally have to give you some vesting rights even though you worked at a company only 1 year.

Accepted Answer

A) True 
 B)False

Question 18

The first step in retirement planning is to

Accepted Answer

A)  determine how large a nest egg is required. 
B)  consider your longevity. 
C)  define your investment program. 
D)  determine your income-earning assets. 
E)  set retirement goals 
A)  determine how large a nest egg is required. 
B)  consider your longevity. 
C)  define your investment program. 
D)  determine your income-earning assets. 
E)  set retirement goals

Question 19

Sally and Patrick are married with 4 young children.Patrick stays at home with the kids while Sally works as CEO of a small manufacturing firm earning $105,000 annually.Sally is covered by a 401(k)plan at work,but they would like to maximize their IRA contributions as well.Which of the following are true assuming their AGI is $105,897?

Accepted Answer

A)  Sally and Patrick could each contribute $3,000 to a Roth IRA. 
B)  Sally and Patrick could each contribute $3,000 to a deductible traditional IRA. 
C)  Only Sally can contribute to any type of IRA. Patrick has no earned income. 
D)  Patrick could contribute $3,000 to either a deductible tradition IRA or a Roth IRA. 
E)  a and d 
A)  Sally and Patrick could each contribute $3,000 to a Roth IRA. 
B)  Sally and Patrick could each contribute $3,000 to a deductible traditional IRA. 
C)  Only Sally can contribute to any type of IRA. Patrick has no earned income. 
D)  Patrick could contribute $3,000 to either a deductible tradition IRA or a Roth IRA. 
E)  a and d

Question 20

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement.
-The first step in retirement planning is to [set retirement goals | decide how much money you cam afford to set aside for retirement].

Accepted Answer

The answer of Choose the word or phrase in [...

A $3,000 annual contribution to a retirement account earning 6% will be worth ____ in 20 years.

Having an accurate current income and expenditures statement would be very useful when calculating retirement needs.

Julie's employer has a defined benefits retirement plan which pays 3.2 percent of her last year's salary for each year of employment.Julie estimates her final salary will be $85,000 and she will have worked for 20 years.What is her expected retirement benefit? (Show all work.)

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. -The employee is subject to the investment risk in a defined [contribution | benefit] plan.

The portion of the principal and interest of an annuity that has not been paid to the annuitant prior to death is the ____ benefit.

____ do not have to be covered by Social Security coverage.

Whether or not your social security benefits will be subject to income taxes depends on how much other income you received during the year.

Henry has a defined benefit plan that promises an annual retirement benefit based on the average of his last five years of salary times 2.5 times years of service.At retirement Henry has 21 years of service and an average salary over the last 5 years of $95,000.What will his annual benefit be?

Reduced early retirement Social Security benefits can be received at age 60.

Marshall has calculated that he will need $1,250,000 in his retirement fund in 40 years when he plans to retire.If Marshall can earn 8% annually over this period,how much does Marshall need to save annually to meet that goal?

By itself,Social Security is sufficient to allow a worker and spouse to maintain their preretirement standard of living.

Integrating a retirement plan with Social Security benefits typically increases a retiree's retirement income.

Government assistance,primarily Social Security,is the largest single source of income for the average retiree.

Annuity proceeds are limited to the life of one person.

Profit sharing plans allow flexible employer contributions to the plan.

With a non-contributory pension plan,the employer makes no financial contribution to the account.

A graded vesting schedule would legally have to give you some vesting rights even though you worked at a company only 1 year.

The first step in retirement planning is to

Understanding the Financial Planning Process

Using Financial Statements and Budgets

Preparing Your Taxes

Managing Your Cash and Savings

Making Automobile and Housing Decisions

Using Credit

Using Consumer Loans

Insuring Your Life

Insuring Your Health

Protecting Your Property

Investment Planning

Investing in Stocks and Bonds

Investing in Mutual Funds

Preserving Your Estate

Filters

Exam 14: Planning for Retirement

A $3,000 annual contribution to a retirement account earning 6% will be worth ____ in 20 years.

Having an accurate current income and expenditures statement would be very useful when calculating retirement needs.

Julie's employer has a defined benefits retirement plan which pays 3.2 percent of her last year's salary for each year of employment.Julie estimates her final salary will be $85,000 and she will have worked for 20 years.What is her expected retirement benefit? (Show all work.)

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. -The employee is subject to the investment risk in a defined [contribution | benefit] plan.

The portion of the principal and interest of an annuity that has not been paid to the annuitant prior to death is the ____ benefit.

____ do not have to be covered by Social Security coverage.

Whether or not your social security benefits will be subject to income taxes depends on how much other income you received during the year.

Henry has a defined benefit plan that promises an annual retirement benefit based on the average of his last five years of salary times 2.5 times years of service.At retirement Henry has 21 years of service and an average salary over the last 5 years of $95,000.What will his annual benefit be?

Reduced early retirement Social Security benefits can be received at age 60.

Marshall has calculated that he will need $1,250,000 in his retirement fund in 40 years when he plans to retire.If Marshall can earn 8% annually over this period,how much does Marshall need to save annually to meet that goal?

By itself,Social Security is sufficient to allow a worker and spouse to maintain their preretirement standard of living.

Integrating a retirement plan with Social Security benefits typically increases a retiree's retirement income.

Government assistance,primarily Social Security,is the largest single source of income for the average retiree.

Annuity proceeds are limited to the life of one person.

Profit sharing plans allow flexible employer contributions to the plan.

With a non-contributory pension plan,the employer makes no financial contribution to the account.

A graded vesting schedule would legally have to give you some vesting rights even though you worked at a company only 1 year.

The first step in retirement planning is to

Understanding the Financial Planning Process

Using Financial Statements and Budgets

Preparing Your Taxes

Managing Your Cash and Savings

Making Automobile and Housing Decisions

Using Credit

Using Consumer Loans

Insuring Your Life

Insuring Your Health

Protecting Your Property

Investment Planning

Investing in Stocks and Bonds

Investing in Mutual Funds

Preserving Your Estate

Filters